National Association of Home Builders Discusses Economics and Housing Policy

New Home Sales Dip in December

Sales of new homes fell 2.2% in December from an elevated November level. The fourth quarter average seasonally-adjusted rate was 309,000, up 4.4% from the third quarter. For 2011, new sales did hit an all-time low of 302,000, which is 6.5% below than the next worst year, 2010. For the year, the Midwest showed no change at 45,000 new home sales, but all other regions experienced a decline. The Northeast declined 32% from 31,000 to 21,000 new home sales, the South declined 4% from 173,000 to 166,000 and the West declined 5% from 74,000 to 70,000.
The national new home sales level fluctuated above and below 300,000 by no more than 10,000 in 9 of the 12 months. The three exceptions were February when snow fall may have been above normal and depressed the annualized figure to 281,000, April when the losses from February and March were made up, and November when an unusually strong South region boosted the national level to 314,000.
Inventories continued to fall to another record low of 157,000 homes with only 61,000 completed and ready to occupy. Median prices fell year-over-year 13, which may be due in part to an increase in sales in the $150,000 to $199,999 bracket.
New and existing single-family home sales have been moving in reasonable concert in 2011 although the December directions were opposite.